Try These 7 Alternatives to Poor Credit Installment Loans

Money emergencies are scary situations, ones that may cause you to consider a poor credit installment loan. But are poor credit installment loans the best choice? Explore these seven alternatives first. They range from building up a savings account to getting rid of bills.

Are Poor Credit Installment Loans the Way to Go? Look Into These Seven Alternatives

When you need money, poor credit installment loans can provide it. However, taking one out could cause you to get stuck in a cycle of debt. An installment loan is a financial product that you can pay back over a set period of time such as over a six-month period. This type of loan is a good option for those who need money right away but know that they won’t have the funds to pay it back in a few weeks.

While poor credit installment loans can be helpful, they aren’t the only option. The following seven alternatives may be a better way to get the emergency cash that you need.

Ask to Work Overtime Hours

If you work a job that pays you hourly, then ask your employer for overtime hours. More hours give you a bigger paycheck. In addition, overtime hours are paid at time and a half. If your employer is open on the holidays, volunteer to work them. Companies often pay double time and a half to employees who work holiday shifts.

Increase Your Money on Hand by Applying for a Second Job

The Balance recommends getting a second job because taking this step is a good alternative to poor credit installment loans. While working more hours is likely to be tough on your home life, it can help you build an emergency fund. It can also give you more money on hand. If an unexpected bill like a medical expense comes up, you may be able to put off paying for it until you start receiving a paycheck from your second job.

You may have a unique skill or hobby that’s in demand. If you do, set up your own little side business to earn extra cash. For instance, if you know how to play a musical instrument, you may be able to give lessons or play at restaurants and weddings. If you’re a skilled cook, consider bottling something special to sell at local farmer’s markets and craft shows.

Build Up an Emergency Savings Fund

According to CNBC, an alternative to bad credit installment loans is to build up an emergency savings fund. Greg McBride, the chief financial analyst for, said, “Nearly 30 percent of Americans don’t have any emergency savings at all. Every little bit you can squirrel away in a savings account acts as a buffer.”

Start with a small portion. With consistency, your emergency savings fund will build. If you can collect enough emergency money, then you’ll be ready the next time you face a financial emergency.

Modify the Amount of Taxes that You’re Withholding

If you typically receive a tax refund when you file but are struggling to begin an emergency fund, then consider modifying the amount of taxes that your company is withholding. The Internal Revenue Service has a calculator on its website, one that will let you figure out the amount of taxes that you should have withdrawn from your paycheck.

Use caution with this alternative to poor credit installment loans. If you don’t have enough taxes withheld from your paycheck, then you’ll wind up owing taxes to the government come April.

Eliminating Some of Your Bills is an Alternative to Poor Credit Installment Loans

Avoid taking out an installment loan by eliminating some of your bills. Getting rid of bills takes focus and consistency. Make a list of your current bills. You may have some that you didn’t know about. For instance, you may have a gym membership that’s being charged to a credit card automatically, one that you aren’t using.

To eliminate some of your bills, look for ways to consolidate. You may be able to combine your homeowner’s insurance and your auto insurance. Or, if everyone living in your home has his or her own cellphone plan, you may be able to get into a family plan and save money.

Take Out a Credit Card Cash Advance

Credit card cash advances aren’t cheap. In fact, this is the most expensive way to use a credit card, but since it will probably cost less than a personal cash loan, it’s considered a good alternative. Use caution with this alternative though because like installment loans, credit card use quickly turns into a cycle of debt.

Balance transfer checks are better if your credit card issuer offers them. But, this option also comes with a fee. If you use a credit card cash advance, then avoid using the account for any other purchases, and pay the balance off as quickly as you can.

Just Pay for the Emergency Purchase with a Credit Card

If you have poor credit, then qualifying for a credit card may be an issue. Consider getting a secured card to build your credit score. Once you have a credit card, then the best alternative to an installment loan may be to just use it. But, use it responsibly. This includes paying what you charge in full by the due date.

Avoid Going Into Debt by Using an Alternative Option

Borrowing options are limited for those who have a low credit score, making installment loans a helpful financial product, but because they are a loan, they’ll cause you to go into debt. Avoid going into debt by using an alternative option. Choices include working overtime hours, taking on a second job or withdrawing a cash advance. To learn more about installment loan alternatives, visit the Personal Money Store.